New Proposed "Multi-Pollutant" Bill Would Cost Jobs
And Billions Of Dollars

DATE: November 5, 2001

BACKGROUND: A Senate hearing was held October 31, 2001
discussing S. 556, the air pollution legislation of Senator Jim
Jeffords (I-VT), which would force cuts of nitrogen oxides, sulfur
dioxide, mercury and carbon dioxide emissions from power plants.
The Environmental Protection Agency forecast that the bill would
raise electricity prices in 2015 by 32-50 percent and cause coal
fired electricity generation to decrease between 25 and 35 percent.
The Energy Information Administration (EIA) concludes that, under
this legislation, the GDP would be reduced by .8 percent in 2007
or about $100 billion with a loss of about one million jobs.

TEN SECOND RESPONSE: These reports show that the cost
of drastically reducing emissions from power plants is billions
in economic loss and forcing a million people out of work.

THIRTY SECOND RESPONSE: While the EPA says we have cleaned
our air considerably, others want to impose more reductions in
emissions that would harm the economy and lay off a million workers.
President Bush is right to warn that he would veto a bill that
would harm the coal industry and raise energy prices, as the economy
is already weak.

DISCUSSION: Mary Hutzler, the EIA's acting administrator,
testified that forcing such a sharp reduction in emissions would
cause electricity prices to increase by 33 percent and natural
gas prices to increase by 20 percent by 2020. To meet the emissions
caps, plants must retrofit generators. EIA estimates that GDP
would drop $100 billion. You can read her testimony at http://www.senate.gov/~epw/Hutzler_1101.pdf

In order to meet the emissions standards, as the EPA pointed out,
coal fired plants must be replaced by natural gas or nuclear power
plants. But many in the Senate do not want to open domestic oil
and gas fields, especially in the Arctic National Wildlife Refuge.
Read the EPA report at http://www.senate.gov/~epw/EPA_Multi-Emissions_Analysis.htm

Exactly how much global warming "gain" would we receive
from this proposal? Patrick Michaels, senior fellow in environmental
studies at the Cato Institute, reports that he ran the United
Nations' computer model on the Jeffords bill and found it would
prevent 0.04 degrees F of global warming over the next 50 years.
Read his report, "New Energy Bill Is Ruinous During Wartime,"
at http://www.cato.org/dailys/10-24-01.html

Jeffrey Holmstead, the EPA's top air official, testified that
President Bush "strongly opposes" regulating carbon
dioxide and it is thought he would veto a bill containing language
that would mandate cuts in CO2.

by Gretchen Randall, Director
John P. McGovern, MD Center for Environmental and Regulatory Affairs
The National Center for Public Policy Research

Contact the author at: 773-857-5086 or [email protected]
The National Center for Public Policy Research
Chicago office
3712 North Broadway - PMB 279
Chicago, IL 60613